Latest Studies

Catastrophes cause global economic losses of $36 billion in the first half of 2018
Swiss Re Institute News Release;
August 16, 2018

This preliminary estimate from the Swiss Re Institute indicates that total global economic losses from disasters in the first half of 2018 were $36 billion, significantly down from $64 billion in the first half of 2017 and well below average. Global insured losses from disasters were $20 billion in H1 2018, down from $30 billion in H1 2017. Winter storm Friederike was the largest H1 2018 loss event with insured losses of $2.1 billion. Disaster events claimed approximately 3,900 victims in H1 2018 — the lowest half-year total in over three decades. A series of winter storms in the United States, including a nor'easter in March, brought heavy snow, ice, freezing rains, coastal flooding and additional flooding from snowmelt to large parts of the U.S., with total economic losses of $4 billion, including $2.9 billion in insured losses. The March nor’easter storm was the largest loss for the insurance industry in the U.S. during the first six months of 2018, with claims of $1.6 billion. Full text


Coastline county population continues to grow
Darryl T. Cohen
Bureau of the Census;
August 06, 2018

This brief report, derived from the Census Bureau's 2016 population survey, tracks population growth in the Atlantic and Gulf Coast regions of the United States. The coasts, which have experienced costly and damaging hurricanes in recent decades, saw combined population growth from 51.9 million in 2000 to 59.6 million in 2016 (a 15 percent increase). Except for 2005 to 2006, a year marked by an intense hurricane season that included three of the costliest hurricanes on record (Katrina, Rita and Wilma), the population in Atlantic and Gulf Coasts grew every year from 2000 to 2016. Full text


Issues paper on climate risks to the insurance sector
International Association of Insurance Supervisors and the Sustainable Insurance Forum;
July 01, 2018

This report from the International Association of Insurance Supervisors and the Sustainable Insurance Forum outlines climate change risks faced by the insurance sector. Some of the risks the report covers include: physical risks arising from natural disasters; the insurance protection gap from weather related losses; climate related claims under liability policies; the impact of climate-related risk on investments, and transition risk arising from disruptions and shifts associated with the transition to a low-carbon economy. Transition risks may be motivated by policy changes, market dynamics and technological innovation. The report sets out a framework of observed approaches to address climate change risks and outlines approaches undertaken by Sustainable Insurance Forum members — Australia, Brazil, France, Italy, the Netherlands, Sweden, the United Kingdom and the U.S. states of California and Washington. Full report


Hurricane Harvey wind damage investigation
Tanya M. Brown-Giammanco, Ian M. Giammanco, and Hank Pogorzelski
Insurance Institute for Business & Home Safety (IBHS);
July 01, 2018

This study of the coastal wind damage caused by 2017’s Hurricane Harvey, examines how structures of various ages, designs and construction techniques fared against the storm’s Category 4 conditions. Homes with lower-quality asphalt roof shingles, sliding glass doors and two-car garages with two separate doors were likely to sustain greater damage from the high winds of Hurricane Harvey. Newer homes, built to modern codes generally fared better than older, weaker buildings. Full report


Why Insurers must invest in insurtechs
Juniper Research;
August 01, 2018

This white paper from Juniper Research, a tech sector analysis firm, forecasts that global insurance premiums generated by emerging insurtech services will exceed $400 billion by 2023, up from $187 billion in 2018. Insurtech platforms are expected to equip insurers to meet the challenges of diminishing margins and increased competition. The paper lists the key insurer-led insurtech Investments for 2017 to 2018, with Allianz’s investment in Lemonade at the top of the list. Full report (login required)


Advancing accumulation risk management in cyber insurance
Daniel Hofmann
The Geneva Association;
August 01, 2018

In this report, the Geneva Association warns that accumulation risks (the potential for large losses from a single event) in the cyber insurance market are a major concern. The demand for cyber insurance is expected to grow rapidly in coming years. Coverage is uneven across major markets, with the U.S. accounting for more than 80 percent of the global market. Penetration rates are low and unevenly spread across industries, ranging from 5 percent in the small and medium-sized enterprises segment to up to 75 percent in the financial sector. Challenges to the cyber insurance market include: the potential for a single large event or a series of consecutive events that make the line unprofitable; re/insurer underestimation of non-affirmative (a.k.a. silent) cyber exposure; historical data that are of insufficient quality for advanced modelling techniques; and government failure to provide adequate frameworks for the sharing of large-scale terrorism-induced losses. Suggestions for risk mitigation include: extending the coverage provided by terrorism pools; additional governmental backstops related to cyber losses; and joint efforts by IT security providers, insurers and authorities to develop and implement foundational IT and information security standards and hygiene. Insurers should reduce opacity by standardizing event definitions and cyber terminology. Appropriate international frameworks should be set up to enable the development and maintenance of standardized databases for cyber incidents similar to databases for natural catastrophes. Full report


Provisional drug overdose death counts
Ahmad FB et al
National Center for Health Statistics;
August 29, 2018

According to preliminary estimates from the Centers for Disease Control and Prevention (CDC) a record 72,000 Americans died from drug overdoses in 2017. The number represents a 9.5 percent increase in overdose deaths from the year before. Overdose deaths involving synthetic opioids rose sharply, while deaths from heroin, prescription opioid pills and methadone fell. Overdose deaths rose sharply in New Jersey, Ohio, Indiana and West Virginia. CDC data


Opioid-related overdose deaths in Massachusetts by industry and occupation, 2011-2015
Massachusetts Department of Public Health;
August 01, 2018

Massachusetts is facing an epidemic of overdoses and fatalities related to opioid painkillers. The number of opioid deaths is estimated to have increased by 100 percent between 2011 and 2015 and is currently higher than the national average. This study examines how on-the-job injuries contribute to the opioid crisis. The report found that construction workers, farmers, fishermen and others employed in workplaces where injury is common, die of opioid overdoses at rates five to six times greater than the average worker. The report examines opioid overdose deaths among Massachusetts residents from 2011 through 2015, according to the industry and occupation of overdose victims and by such demographics as gender, race/ethnicity and age. Full report


Digitizing the customer auto insurance relationship
Insurance Research Council;
August 22, 2018

While phone calls remain the most common method consumers use to manage their auto insurance, many consumers are eager to use digital methods to accomplish the same tasks, according to this survey from the Insurance Research Council. Sixty-nine percent of survey respondents said they had communicated with their insurer in the previous year to accomplish one of several tasks, such as adding or removing a vehicle from their coverage. For every task examined, a majority said they had communicated with their insurer by phone. The only tasks in which 30 percent or more used a digital method (email, website or mobile app) were checking on the status of a claim and obtaining a certificate of insurance. Despite the continued reliance on non-digital communication, respondents consistently reported a preference to use digital methods more in the future. For more detailed information on the study’s methodology and findings, contact David Corum at 484-831-9046 or by email at IRC@TheInstitutes.org. Visit IRC’s website, www.insurance-research.org, for information about purchasing a copy of the report. News release


IIHS examines driver assistance features in road, track tests
Insurance Institute for Highway Safety (IIHS);
August 07, 2018

The IIHS has been developing a consumer ratings program for advanced driver assistance systems by testing select models. Their evaluations of adaptive cruise control and active lane-keeping show variable performance in typical driving situations, such as approaching stopped vehicles and negotiating hills and curves. The early results underscore that today's systems are not robust substitutes for human drivers. When driver assist systems did not perform as expected, the outcomes ranged from the annoying, such as too-cautious braking, to the dangerous, such as veering toward the shoulder if sensors could not detect lane lines. Full text


Evolution of mobility: autonomous vehicles
Cox Automotive;
August 16, 2018

This Cox Automotive survey found that consumer awareness of self-driving vehicles has skyrocketed, and that the desire for autonomous features is high. However, self-driving vehicles are viewed as less safe by consumers compared to two years ago, with most notably, the vehicle autonomy preference shifting from Level 4 to Level 2 (the level currently available for most new vehicles). The survey found that 84 percent want to have the option to drive themselves even in a self-driving vehicle, compared to 16 percent who would feel comfortable letting an autonomous vehicle drive them without the option of being able to take control. The number of respondents that believe roadways would be safer if all vehicles were fully autonomous versus operated by people has decreased 18 percentage points in just two years. Despite some negative media coverage, consumers want, and expect, semi-autonomous features, particularly those centered around safety, signaling a disconnect between consumer perception of safety tech features versus fully autonomous vehicles. About 54 percent of respondents agreed that semi-autonomous features make people better drivers. Collision warning alert systems and collision avoidance systems are top-ranked features considered a must-have in the next vehicle purchase/lease. Full report


Motor vehicle accidents in workers compensation
National Council on Compensation Insurance (NCCI) Research Brief;
August 08, 2018

According to this NCCI Research Brief, a decline in the overall frequency of workers compensation claims was offset by the frequency of claims for motor vehicle accidents from 2011 to 2016. About 41 percent of fatal workers compensation claims resulted from motor vehicle accidents during that period. Because of the severity of injuries associated with motor vehicle claims, costs associated with these claims are 80 percent to 100 percent more than average and represent a higher share of the costliest claims. Over the five-year period, motor vehicle claims accounted for 28 percent of worker compensation claims of more than $500,000, compared with only 5 percent of all claims. The NCCI said that one of the primary factors causing an increase in motor vehicle accidents is the growing popularity and use of smartphones. Full text


Private passenger automobile insurance - a review of the market in Missouri
Missouri Department of Insurance;
July 01, 2018

This report on the Missouri market for private passenger auto insurance found no evidence of systematic pricing differences per unit of risk between population segments. However, some aspects of the market suggest that further research may be warranted, and some important features of the market are excluded from analysis due to a lack of data. Most notably, insurer underwriting practices, or criteria used to determine whether to issue coverage, are not filed with the department. Other notable findings include: when adjusted for inflation, the typical Missouri driver has seen a 17 percent decrease in their auto insurance premiums since 1998; premium levels for liability coverage are two-times higher in Kansas City and St. Louis than they are in the rest of the state; about 13.7 percent of Missouri’s drivers are operating vehicles while uninsured. Full report


Teen driving study
Liberty Mutual;
August 01, 2018

A recent survey commissioned by Liberty Mutual Insurance suggests some parents are having a difficult time setting a good example for their teen drivers. The survey found 37 percent of parents use apps while driving, compared to 38 percent of teenage drivers. It also found that 20 percent of parents admit to texting while driving, even though 30 percent of teens say their parents text and drive. The survey found 37 percent of parents admit not enforcing punishments when their teen drivers break a rule, or even the law. In announcing the survey results, Liberty Mutual urged parents to set rules and enforce them. Full text